Table of contents:
- Key Summary
- What is ADGM and where is it located?
- Who is ADGM best for?
- What types of businesses can be set up in ADGM?
- What legal structures can you register in ADGM?
- Do you need a physical office in ADGM?
- What documents are usually required for ADGM setup?
- Step-by-step how to set up a company in ADGM
- How much does it cost to set up in ADGM?
- How long does ADGM setup usually take?
- What happens after you get the ADGM licence?
- Common mistakes businesses make when choosing ADGM
- How Daftra can help you in setting up a company in ADGM
- FAQs about setting up a company in ADGM
ADGM is one of the leading Free Zones, providing transparency and familiar regulatory frameworks for a wide range of business activities, especially as it applies English Law, which many investors will appreciate.
It’s considered a premium Free Zone that supports both financial and non-financial businesses, offering investors a great opportunity to benefit from it, especially as each business entity has its own regulatory authority, which smooths the setup process and gives you a clear picture of what you need to do within ADGM.
If you have already explored Abu Dhabi Free Zones options and decided that ADGM company formation is the best option for you.
We’ll support you during the setup process by covering the main business categories and the legal structures that you need to choose from. Then, we’ll walk you through the setup stages and their requirements, as well as the post-setup requirements you need to complete, whether you have a financial or non-financial entity.
What is ADGM and where is it located?
Abu Dhabi Global Market is a premium Free Zone that applies English Law within its jurisdiction, giving it strategic importance for foreign investors. It has various independent authorities that regulate and issue licenses for various business types, including financial, non-financial, and retail businesses.
ADGM was located on Al Maryah Island, which served as the financial district within the Free Zone. Then, Al Reem Island was added to ADGM’s jurisdiction through a UAE Cabinet decision in 2023, to become one of the largest financial districts in the world. ADGM also has access to strategic trading gateways in the UAE, such as Zayed Port and Airport.
Who is ADGM best for?
Before moving further, you must ensure that the ADGM Free Zone is the right option for your business model. You can check the conditions below to see whether they match your business needs.
- Financial businesses that need a specialized financial authority that understands their business requirements, such as banking and fintech companies.
- Non-financial businesses that provide professional services to other companies, such as consultancy and advertising.
- Retail businesses that sell goods or services directly to consumers in ADGM without starting a Mainland company setup in Abu Dhabi.
- International businesses that need to clearly understand the concepts and rules using a familiar law such as English Law, as it’s widely used in global markets.
- Companies that prefer dealing with dedicated and dependent authorities based on their business type, as this makes the setup process and regulations clearer.
- If you’re looking to establish a non-operational legal structure to hold assets without taking on risk, which is generally at a lower cost.
What types of businesses can be set up in ADGM?
ADGM offers 3 main business categories, with many activities companies can choose from depending on their business model. As you’ll notice, it’s not limited to financial businesses, as it also supports other business types. Check the categories below and clearly identify the best option for your company.
What legal structures can you register in ADGM?
You need to decide which legal structure you’ll choose from the start, as it determines the management structure and liabilities between shareholders. Below are the common legal entity types divided by their operating goals.
| Entity type | Legal form | Description |
| Company | Public company limited by shares (PLC) | It’s a company that can be quoted on the stock exchange and sells its shares to the public, and the shareholders' liability is limited to the amount paid on their shares, which separates their personal assets from the company’s debts. |
| Private company limited by shares (LTD) | It can’t offer its shares for sale to the public through the stock market, and each shareholder's liability is limited to the shares they invested in the company. | |
| Protected cell company | It’s a corporate structure with a single legal entity that includes a core and various cells, and each cell is independent and has its own assets and liabilities, but the entire unit serves as a single legal entity. | |
| Branch office | It’s designed for foreign or local companies that want to establish another branch in ADGM, so they can operate using the same parent company’s name. | |
| Partnership | Limited Liability Partnership (LLP) | It’s designed for professionals who want to establish their own company jointly, such as accountants and lawyers. It protects each partner's personal assets from any risks that could occur with other partners. |
| General partnership | It’s operated by partners with unlimited liability who manage the business together, which means their personal assets can be liable for the partnership’s debts and obligations. | |
| Limited partnership | It includes two or more partners who conduct the business jointly, and their liability is limited to what they’ve invested in the company, which protects their personal assets. | |
| Foreign partnership branches | It can be either a general or limited partnership for a company established outside ADGM that wants to expand its parent company’s presence. | |
| Entity for holding assets | Restricted scope company (RSC) | It’s a legal form under the SPV's legal category, which serves as a private company that has less information shown publicly and lighter compliance requirements. It can only be established as a subsidiary by a parent company that publishes the reports for its entire group. |
| Foundation | It’s used by families who want to hold assets or manage wealth, as this type has its own distinct legal personality, and it has the flexibility to enter into arrangements and contracts directly. |
ADGM offers around 18 legal entity types that have their own features and requirements. If you want to have a broader overview of all types, you can check them on the official website.
Do you need a physical office in ADGM?
Yes, all companies in different business categories in ADGM need to register a physical office, as this indicates that they have adequate substance. Generally, the office type is linked to the company’s visa eligibility, so you must decide wisely depending on your workforce capacity and operational needs.
At ADGM, there are a variety of office types across both Al Maryah and Al Reem Islands, which range from business centers to commercial spaces. You can check all available office spaces and types on the ADGM official website to evaluate office decisions efficiently.
However, the special purpose vehicle (SPV) is the only legal structure that doesn’t require leasing a dedicated office; it only needs a registered address.
What documents are usually required for ADGM setup?
The documentation phase varies depending on the business category you’ll register in, so you need to prepare these common documents along with the specified documents for your business category, which you’ll find below.
- Passport copies of directors and shareholders.
- Copy of a valid UAE residence visa.
- Resolution (template available at ADGM).
- Articles of association.
- Signed office lease agreement.
- Details of your data processor (if appointed).
- Certified true copy of certificate of registration.
- AML documents, if the activity is within the AML requirements.
- Business brief.
- Source of wealth document.
- In-principle approval (IPA) from the FSRA authorisation (For financial companies).
- Approval of store concept (For retail category).
You also need to know that all documents at ADGM must be in English, and notarization isn’t required unless the authority requests it.
Step-by-step: how to set up a company in ADGM
It offers a simple and transparent setup process, and if you pay close attention to all the requirements we have explained, you’ll have an easy formation process without any complications.
Step 1: Preparing the application
The first thing you need to do is decide the business type that you’re going to choose, whether it’s the financial, non-financial, or retail category. This step will shape the business activities you’re going to conduct within ADGM, so check which business category your activity falls under.
Then, you’ll need to select one of the legal structures we’ve listed before, as it will shape the internal management of the business. You’ll find that the company name needs to include the legal structure suffix, so make sure to include that and check whether your trade name is available through the ADGM website.
After that, you have to lease dedicated office space because it indicates your company has a legal presence in ADGM. You’ll find many office solutions, such as dedicated desks and office spaces. If you’re registering an SPV, the authority will only ask you for a registered address.
Step 2: Submit the application and documents
In this stage, you need to pay attention to any additional documents required by the authority. For example, you need to get the office lease contract along with other required documents we’ve listed. Businesses that will conduct financial activities must obtain the IPA documents before submitting the application.
Step 3: Receive the commercial license.
Once the responsible authority reviews your application, it’ll send you the required fees to issue your license. Once it’s paid, you’ll receive your commercial license, and you can conduct your business freely in the ADGM Free Zone.
How much does it cost to set up in ADGM?
ADGM setup costs depend on many factors that can make the cost higher or lower, such as the business category, office, and visa fees. ADGM doesn’t provide exact prices because they change over time, so we collected the indicative costs that ADGM provided on its official website below to have an overview of the setup costs.
You’ll find that other business types such as SPVs have specific fees that apply to them, which are usually lower than those for other business types. For example, the SPV costs can start from $1,900.
Because the costs are variable, you can check the indicative costs using the cost calculator in the fees section on the ADGM website.
How long does ADGM setup usually take?
The timeline depends on your document preparation and whether additional approvals are needed. For example, financial businesses need to obtain an IPA document before registering, which could take more time if the documents aren’t complete.
Generally, the ADGM company setup can be completed within 10 working days, which can be faster if you follow all the setup stages we have already outlined.
What happens after you get the ADGM licence?
After completing the registration process, you should start the post-setup steps to have a smooth business operation and remain compliant in ADGM. Below are the main post-setup steps that will support your company during operations.
- Open a corporate bank account: Having a separate account to receive payments and conduct your transactions is the ideal way to deal with clients in ADGM, as it gives credibility to your company.
- Corporate tax registration: You’ve already spent enough money on registration, so you need to complete all CT registration and filings on time to avoid unnecessary penalties and save money to scale your business.
- VAT registration: It’s important to know what money is going in and out of your bank account, and VAT will help you with that by clearly separating your company’s profit from VAT-included charges.
- Operational system setup: Nowadays, it’s non-negotiable to set up an operational system. Whatever your business type is, you need to make sure that you’re using an efficient operating system that helps you maximize your profits over time.
Common mistakes businesses make when choosing ADGM
Some investors tend to focus only on the Free Zone benefits, without evaluating whether ADGM actually suits their business. Below are the common mistakes businesses make when choosing ADGM that you can prevent from the start.
- Neglecting the Free Zone evaluation process, especially since it’s considered a premium Free Zone, means you should first assess whether the setup can generate enough returns for your business.
- Misidentifying the business category and legal structure can lead to an unclear management structure, which directly affects business operations. So you must distinguish between all types we’ve outlined to choose the ones that suit your business.
- Ignore the specific number of business activities you’re going to conduct, because what matters is the business categories and activities, so you should clearly identify what you’re going to conduct.
- Ignore compliance procedures, especially since ADGM has various specialized authorities and courts for each business type. For that reason, you need to follow the authorities' regulations and register for tax once you reach the threshold.
- Poor budget planning can lead to financial surprises that may disrupt your operations, so ensure you have allocated enough budget for visas and renewal requirements. You can find the required renewal procedures in the Ajman Free Zone renewal guide.
How Daftra can help you in setting up a company in ADGM
You’ve chosen ADGM Free Zone to focus on scaling your business over time, so you should use a customizable ERP system that supports your vision. This is exactly what Daftra VAT & Corporate Tax Software in UAE does, as it helps you with the following:
- Generate detailed financial reports for ADGM authorities.
- Handle CT and VAT filings to maintain compliance.
- Track stock levels across your inventories.
- Track employees' productivity.
- Generate employee reports to track progress.
FAQs about setting up a company in ADGM
Can I set up an ADGM company remotely?
Yes, you can use the ADGM’s online registry solution to submit your setup application and pay charges. However, you’ll still need to have a dedicated office in the Free Zone and have a real presence in ADGM for operations.
Is ADGM only for financial services companies?
No, the ADGM Free Zone has other business categories, not only financial activities. It also has the non-financial category for businesses that offer services or technical activities, and the retail category for businesses that sell products and services.
Do I need FSRA approval to set up a company in ADGM?
Yes, if you’re establishing a financial business, you will not be able to proceed with the formation process unless you have FSRA approval and receive the IPA document.
Can an ADGM company trade or provide services in the UAE mainland?
Typically, you can’t conduct operations in the UAE mainland unless you have a DED license or certain approvals. So, if you want to trade on the mainland, you’ll need to register with the Abu Dhabi Department of Economic Development (DED) for a licence.
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